Despite price hike, gold is the flavour of the wedding season

AHMEDABAD: With cases of Covid-19 receding, the kamurta period ending and weddings being organized in a big way again, gold demand has remained upbeat despite the hike in prices.

Even though gold prices touched a peak of Rs 51,500 per 10 grams last week — a 12.5-month high for the Ahmedabad market, gold jewellery sales have remained strong.

“Increase in gold prices has not impacted gold jewellery demand. Besides pure gold, demand for diamond jewellery, as well as silver and rose gold jewellery, is equally good. With the Omicron wave remaining relatively milder and a spike in wedding occasions, the sales have been good. In the coming days, several weddings have been planned because of the shubh muhurats,” said Jigar Soni, president, Jewellers’ Association of Ahmedabad (JAA).

Besides jewellery, even bullion demand has increased from investors, suggest market sources.

Gold price settled at Rs 51,300 per 10 grams in Ahmedabad. After rallying every single day for 10 consecutive days, the gold price finally slid here marginally – down by Rs 200 against Rs 51,500 per 10 grams on Wednesday. Gold prices have been rallying for the past 10 days in the backdrop of escalating tensions between Russia and Ukraine, and surging crude oil prices, said analysts.

Gold is often considered to be a hedge against inflation, economic and geopolitical uncertainty. “Tensions between Russia and Ukraine have been escalating over the past several days because of which the gold price has rallied dramatically. However, Russia’s defence ministry announced the start of a pullback of some forces after drills that had led to US and Europe speculating a military attack on Ukraine. Amidst indications of easing tensions between the two countries, gold prices went marginally down,” said Hemant Choksi, a bullion trader based in Ahmedabad.

Besides geopolitical tensions, gold prices also escalated because of rising global inflation and surge in crude prices, which may further impact inflation levels.

Courtesy: Times of India